Fraudsters target the pensions of 11m Britons

NEARLY 11million Britons have been targeted by rogue firms trying to steal their pension, a report warns.

Unwitting savers are being hounded by unsolicited cold calls, text messages and emails trying to persuade them to cash in their retirement pot with the lure of high interest rates.

In the wake of pension freedoms introduced a year ago, victims are being persuaded to transfer their nest egg into sham investments such as vineyards, overseas property and tea plantations, according to a study by Citizens Advice.

Many are being promised of higher returns on their investments – only for the company to disappear with their money. A common trick used by f raudsters i s to pretend to be approved by a government department or authorised by City watchdog the Financial Conduct Authority.

A separate swindle offers savers the opportunity to access their pension pot early – before the age of 55.

As well as losing all their savings, victims of these schemes can be hit with a tax bill of 55 per cent on what they withdrew.

It is estimated that at least half a billion pounds has already been lost to pension scams. But the Pensions Regulator believes the real figure is much higher, with hundreds of thousands of victims.

Consumer campaigners fear fraudsters are exploiting pension freedoms that came into force last April which allow anyone aged 55 or over to cash in their entire pension pot.

The move was designed to give people more choice about what to do with their life savings.

But Citizens Advice says up to 10.9million have since been cold- called by a rogue firm. Those aged 55 to 64 are the most popular fraud targets.

Criminals have changed tactics to make their schemes more believable, Citizens Advice says. Instead of trying to persuade people to part with their money over the phone, they invite victims for a ‘free pensions review’ during which they try to cajole them into ploughing their money into sham investments.

One saver lost £62,500 after transferring his pension to a company that was not registered by the FCA.

Gillian Guy, chief executive of Citizens Advice, said: ‘Fraudsters have shifted their tactics to rob people of retirement income. It’s difficult for consumers to stay ahead of pension s cams as t hey evolve. Many scammers use professional-looking websites and leaflets to fool their victims into signing up to free pensions advice, or cold call with offers of unusually high investment returns.’

Citizens Advice found that nearly nine in ten of us would fail to spot common warning signs of a pensions scam – such as the promise of high returns of 10 to 15 per cent a year, or the offer of ‘free investment advice’.

Nearly two-thirds of the 2,000 the charity surveyed said they would consider an unsolicited offer involving their pension.

City of London Police are working with regulators and government departments to crack down on the fraudsters but most are getting away with their crimes.

Action by the National Crime Agency has resulted in a number of websites being suspended.

A joint investigation by the Serious Fraud Office and Nottinghamshire Police led to a businessman being jailed for more than ten years last October for a £47.5million investment fraud involving life savings and pensions. His partner received a suspended sentence.

‘Unusually high returns’